TNAG-1873-FCO40-2661-Relations-between-Hong-Kong-and-China-1989 — Page 16

FCO40 Hong Kong Department Records 聯邦事務部香港部檔案 All

CONFIDENTIAL

17.

Situation in China Report (Paper CRC 15/88)

18.

Ag PA said that in a sense this paper was a political

footnote to the last one. The wider political consequences of the shift in attitude to economic reform would only appear after a while. The immediate political effect was that speculation had centred on Zhao's position. He was personally associated with

reform and his rise had been as a result of his reform

success in Szechuan. When he had moved from the post of

premier to that of Secretary General, people had said

that he would not give up dealing with the economy.

This had now changed. He himself had said that he was no longer running the day to day economic affairs. Ag

PA said that he would not be surprised if Zhao had been

persuaded to withdraw from the economic arena. This

could have been the result of Deng advising him to

disassociate himself from the various problems.

Alternatively, those who were against his line of

'biting the bullet on price reform' could have forced

him out of direct involvement. If the Chinese were only

slowing down on reform and still intended to move

forward in a steady way, then it was possible that Zhao

would return. Ag PA, however, said that he hesitated to

speculate as to what might happen to Zhao should the economic management exercise the Chinese were engaged

upon fail.

Any Other Business

(a) Visits to Guangdong

It was confirmed to SLW that Governor Ye of

Guangdong Province would no longer be coming to

Hong Kong in November. SLW informed members that

by December the options for the PADS study would

be shortlisted. Information would then be needed

CONFIDENTIAL

1

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